What’s a View Worth?

Several neighbors in Denver’s Grant Ranch subdivision say they were pleased when billionaire Dish Network DISH -0.38% Chairman Charlie Ergen bought a house on 35 acres adjacent to their homes with plans to preserve the property.

Sybille English’s bedroom window currently overlooks large piles of dirt that will create part of the berm surrounding a 35-acre property nearby. She fears that the berm and evergreens that will follow affect her property value.

They didn’t anticipate what happened next: Crews working for Mr. Ergen began building a 6-foot-high, half-mile-long earthen berm around much of the property in November, planting mature evergreen trees atop it. The barrier, which ensures the privacy of the lone home on the parcel, also ended up blocking his neighbors’ view of open fields and nearby Bowles Lake.

“We’ve been worried about losses to our property values and quality of life as a result of the construction of the berm and the height and density of the trees planted on top of it,” said Larry Arneson, a civil engineer whose three-bedroom, 2½-bathroom house backs up to Mr. Ergen’s property.

Grant Ranch homes with views of the small lake and other nearby reservoirs have sold in recent years for $50,000 to $100,000 more on average than comparable Grant Ranch homes without the view, said Jim A. Urban, a real-estate consultant at Urban Cos. Real Estate who has sold houses in Grant Ranch. Homes adjacent to Mr. Ergen’s property range in value from roughly $325,000 to $1.1 million, according to real-estate listing service Zillow.

FENCES: Some residents are asking Charlie Ergen to improve their view by removing a few trees from the berm and replacing the chain-link fence with a wrought-iron one.

The Denver dust-up underscores how the mantra “location, location, location” can come down to property’s view. Academic studies and appraisers note that a pristine view, especially of a lake or ocean, can boost a home site’s value by 5% to nearly 300%, depending on the scope of the view and what it contains. A more common range, however, is 10% to 50%. Conversely, obstruction of such a view can wipe out tens of thousands, even hundreds of thousands, of dollars in value.

Homeowners, meanwhile, have little recourse to reclaim their obstructed views unless local ordinances offer view protection or procedures to resolve disputes. Absent city guidelines, property owners are allowed to use their property as they wish—including for planting tall trees.

SEEING RED: Bob and Sybille English live in Grant Ranch, a Denver subdivision, and say property values may be hurt by an earthen berm and trees that block some views.

A group of neighbors in Grant Ranch said they are talking with Mr. Ergen’s representatives hoping he’ll agree to make slight changes to the berm, such as varying its height, removing a few trees and installing a wrought-iron fence along it rather than a chain-link variety. So far, they’ve made little progress. They had hired an attorney to help them negotiate with Mr. Ergen, but they say that they’re unlikely to sue. Mr. Ergen is best known for building Dish Network over more than 30 years into a satellite-television colossus with 14 million subscribers.

Complicating the berm brouhaha is that the two sides are in different municipalities. Though less than 100 yards separate the Grant Ranch homes from Mr. Ergen’s property, the former are mostly in Denver while the latter is in Bow Mar, Colo.

Mr. Ergen, who lives in Bow Mar but not on the 35-acre parcel, declined to comment. Officials in Bow Mar say the construction and design of the berm comply with town guidelines—and that they’re not obliged to protect the views of people outside the town’s boundaries.

Research on residential views has shown that determining their value can be subjective, with a wide range of results. A study published in 2010 by Clemson University professor Stephen Sperry and researcher David Wyman examined 600 lot sales in the golf community of the Reserve at Lake Keowee in South Carolina for so-called view premiums. Their research found that lots with views of golf-course fairways sold at prices 42% higher than similar lots without a view. They also found that lots with lake views sold for 94% more than viewless lots, and those with both lake and mountain views sold for 133% more.

“The longer views, the farther the extent, have a greater value, especially from a water standpoint,” Mr. Sperry said.

The view needn’t be natural to be valuable. A study published in 2008 by University of Nebraska at Omaha professor Steven Shultz and a research assistant found that homes with views of either of two man-made lakes in Nebraska sold for 7.5% and 8.3% more, respectively, than houses without lake views in the same neighborhood.

Appraisers often find similar disparities. In New York, Jonathan Miller, president and chief executive of appraisal firm Miller Samuel, said an apartment with a view of Manhattan’s Central Park can sell for 50% more than one in the same building without the view.

With views commanding such premiums, anything that blocks them can cause an uproar, sometimes leading to lawsuits or city intervention. In 2010, software mogul Larry Ellison sued his San Francisco neighbors over trees that offered them privacy but blocked Mr. Ellison’s view of San Francisco Bay from his four-level house. The case was settled in 2011, with the neighbors trimming the trees to restore Mr. Ellison’s view.

In another case, a neighbor planted trees in 2006 that blocked part of Merton Lawwill’s panoramic view of San Francisco Bay from his four-bedroom, 3½-bathroom house in Tiburon, Calif. As Mr. Lawwill went through arbitration and a lawsuit to get the neighbor to move the trees, appraiser Curt Thor of North Bay Real Estate Appraisals calculated that the view blockage had sapped 17% to 20% of the value from Mr. Lawwill’s $2.6 million home. The case was settled in 2009, with the neighbor agreeing to move some trees elsewhere and trim others, both sides say. “So I spent $200,000 [in legal costs] to keep my view,” Mr. Lawwill said. “It was three years of agony.”

It’s too early to determine how the case of Mr. Ergen’s berm will be resolved. Few dispute that the situation could have been worse. The property’s previous owner, the estate of late developer and grocery-store magnate Lloyd King, had pursued selling the property to be developed into 40 houses before opting instead to sell it to Mr. Ergen in 2011. The price: $7 million, according to Land Title Guarantee Co.

“I’d rather see the [trees] than a bunch of additional McMansions,” said Mark Griffiths, whose 2,400-square-foot home backs up to the berm.

Still, some fear they’ll never get their view back. “It’s not aesthetic,” said Sybille English, who with her husband, Bob, owns a 4,700-square-foot home adjacent to the berm. “It’s just not pleasant for a potential home buyer, or for us, to look at.”

Saving Sightlines

Depending on where you live, protections might be in place to preserve your view. Some steps to follow:

DON’T ASSUME that vacant land won’t eventually be developed, unless it is a designated open space.

TAKE PICTURES of your home’s views after buying it, says appraiser Curt Thor of North Bay Real Estate Appraisals in Novato, Calif. Then, file the photos away in case they’re needed later to demonstrate their loss due to obstruction.

CHECK CITY ORDINANCES to see if they limit the height of buildings or trees. San Antonio and Colorado’s Boulder County, for example, both have height restrictions in some areas.

ASK IF the city has a view restoration or view-resolution program that establishes procedures for resolving view disputes, often through arbitration or mediation. Among the cities with such programs are Malibu, Calif., and Santa Barbara, Calif.

STRIKE A DEAL to buy an easement from your neighbor under which the neighbor agrees not to obstruct your view.

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